Home > Publications > Childhood preventive care, adult healthcare and economic growth: The role of healthcare financing

Childhood preventive care, adult healthcare and economic growth: The role of healthcare financing

Woode, M. E., Nourry, C. & Ventelou, B. (2014)

Economics Letters, 124(1), 41-47. doi:10.1016/j.econlet.2014.04.017

Summary

We analyze the impact of healthcare financing on economic growth, focusing on the issue of the joint public–private financing of healthcare (co-payment). We use an overlapping-generations model with endogenous growth based on health human capital accumulation, where families pay for childhood preventive care and the government can either fully finance or co-finance adulthood curative care. From a growth maximizing perspective, distortionary taxes give an advantage to co-financing. Nevertheless, we prove that, if agents are assumed to be heterogeneous in preferences, full financing can become the best option.

Keywords

Growth; Economic development; Human capital; Health